Monday, June 20, 2011

Krugman on the New Drachma

Even though it has long been obvious that non-default is not an option, the European leaders and institutions pursue a strategy of delay with no solution in sight. Then,

“for Europe ex-Greece, the costs of delay are whatever delay does to reduce the amount that Greece will eventually pay its creditors. I think there’s a good case to be made that at this point demands for even more austerity are counterproductive, even in terms of creditors’ interests: the Greek economy is suffering long-term damage, the Greek political scene is being radicalized, and the chances of Greece just telling its creditors to take a hike while it devalues the new drachma are rising.”(Krugman’s blog in the New York Times, here).

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About Me

As a professor of economics, my main specialization fields are in the theory and strategy of the firm, and the theory and applications of public choice (political economy).
I also do consulting work in these fields.
For more information on my work go to my homepage: http://jeanjacques.rosa.pagesperso-orange.fr/
and my SSRN author page: http://ssrn.com/author=471576.
My e-mail has changed: jj.rosa@orange.fr